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London without the Russian Oligarch Money, a poorer place...


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https://www.telegraph.co.uk/business/2022/06/17/london-get-lot-poorer/

We might have hoped that the Prime Minister’s ambitious plans to rebalance the British economy, and to close the massive gaps in wealth, productivity and entrepreneurship between London and the regions, would have involved making Bangor, Burnley or Bolton a little richer than they once were. Instead, it turns out that something entirely different is about to happen – London is about to get a lot poorer.

The Russian oligarchs who kept the law and PR firms lavishly employed have all been sanctioned. The venture capital-fuelled tech start-ups are about to start laying off their staff in droves as the money that kept them afloat evaporates. And the City faces a bleak few years as the chill of a bear market descends at the same time as ministers have shamefully failed to compensate for leaving the European Union with any form of meaningful deregulation.

For most of the last two decades, the city was on a roll, turning itself into one of a handful of global high-growth urban hubs. From 2000 to 2020 its GDP more than doubled, rising from £200bn to over £550bn. And its growth meant it dominated the UK to an extent that was rarely matched in its long history. 

According to the Office for National Statistics, London alone accounted for 22pc of total UK output, and if you added in the commuter belt counties that figure rose almost 40pc.

First, London was the main European hub, and arguably the main global centre, for Russian money. 

Vladimir Putin’s circle of mega-rich oligarchs, along with their wives, children, mistresses and hangers-on, flocked to the capital. They bought up football teams, newspapers, Mayfair and Hampstead houses, and they filled the restaurants, theatres and clubs. 

Their money funded small armies of legal, financial and public relations advisers, charging lavish fees without any questions. And yet, with the war in Ukraine, all that has come to a sudden end. The oligarchs have (quite rightly, it goes without saying) been sanctioned, and the spending has been turned off. That will hit lots of places, but it will hit London hardest of all.

Next, it was Europe’s key tech hub. There was more venture capital money pouring into whizzy start-ups in Shoreditch than anywhere else in Europe, and more "unicorns", as new companies worth more than $1bn are known, as well (London had 47 at the last count, more than double its closest rival Berlin). 

And yet right now, all those companies are starting to lay people off in droves as the Nasdaq crashes and the easy money dries up. It has started in New York, San Francisco, and Los Angeles where Netflix, Peloton and the trading platform Robinhood have all started laying people off, while Meta and Twitter have frozen hiring. The same thing is about to happen in London over the course of the summer

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Edited by shlomo
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4 minutes ago, byron78 said:

Good riddance.

If this article from the Telegraph is accurate UK GDP could decrease about 20% within a few years

FYI I was in Shoreditch about an hour ago and it was empty, my friend said it was because Covid had changed behaviour I said not but I did not tell him this as how do you explain Putin has destroyed London...

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10 minutes ago, shlomo said:

If this article from the Telegraph is accurate UK GDP could decrease about 20% within a few years

FYI I was in Shoreditch about an hour ago and it was empty, my friend said it was because Covid had changed behaviour I said not but I did not tell him this as how do you explain Putin has destroyed London...

Indeed.

It is really eerie in parts.

Park Lane is just a ghost town.

Edited by byron78
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1 minute ago, byron78 said:

Indeed.

It is really eerie in parts.

Park Lane is just a ghost town.

Tax intake must be significantly down.

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40 minutes ago, shlomo said:

https://www.telegraph.co.uk/business/2022/06/17/london-get-lot-poorer/

We might have hoped that the Prime Minister’s ambitious plans to rebalance the British economy, and to close the massive gaps in wealth, productivity and entrepreneurship between London and the regions, would have involved making Bangor, Burnley or Bolton a little richer than they once were. Instead, it turns out that something entirely different is about to happen – London is about to get a lot poorer.

The Russian oligarchs who kept the law and PR firms lavishly employed have all been sanctioned. The venture capital-fuelled tech start-ups are about to start laying off their staff in droves as the money that kept them afloat evaporates. And the City faces a bleak few years as the chill of a bear market descends at the same time as ministers have shamefully failed to compensate for leaving the European Union with any form of meaningful deregulation.

Hilarious.

The Torygraph is a propaganda rag. They're getting this excuse in so they can blame Putin and anything else apart from their beloved brexit.

And for good measure throwing the old "we just didn't brexit properly" in there.

Slimey c%nts..

 

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55 minutes ago, dugsbody said:

The Torygraph is a propaganda rag. They're getting this excuse in so they can blame Putin and anything else apart from their beloved brexit.

Well did the UK government confiscate Russian assets when we voted in 2016 or when Putin invaded Ukraine ? 

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3 hours ago, shlomo said:

"ministers have shamefully failed to compensate for leaving the European Union with any form of meaningful deregulation".

What does the Telegraph mean 'fail to compensate for leaving the EU'? 

I thought that was meant to be a good thing?

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12 hours ago, byron78 said:

Indeed.

It is really eerie in parts.

Park Lane is just a ghost town.

Meanwhile, at the other end of the country, I went to Falmouth, and it was buzzing, 8 pm, restaurants busy, lots of people walking through the town, car parks around three quarters full.

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11 minutes ago, skinnylattej said:

Meanwhile, at the other end of the country, I went to Falmouth, and it was buzzing, 8 pm, restaurants busy, lots of people walking through the town, car parks around three quarters full.

Go there out of season though...

Isle of Wight is extraordinary in some parts now.

You can go days in Seaview without seeing another soul in the colder months.

Edited by byron78
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41 minutes ago, skinnylattej said:

Meanwhile, at the other end of the country, I went to Falmouth, and it was buzzing, 8 pm, restaurants busy, lots of people walking through the town, car parks around three quarters full.

Tourism is coming back to London too. The queues are back outside Mde Tussauds and other tourist honey traps. Even the airbnbs in places like Kilburn are filling up again. The tourist sector may not earn the big bucks that the financial sector does, but it still employs a lot of people.

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10 minutes ago, Trampa501 said:

Tourism is coming back to London too. The queues are back outside Mde Tussauds and other tourist honey traps. Even the airbnbs in places like Kilburn are filling up again. The tourist sector may not earn the big bucks that the financial sector does, but it still employs a lot of people.

Yeah London is busy now although probably still not back to pre pandemic areas. Due to the UK being the first to open borders with no COVID restrictions so tourists were booking in. 

Those expensive areas aren't the real London streets anyway, other than as a cut-through or walk around to gawp at them rich houses.

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The whole start-up scene has been inflated by 10 years of really cheap money and above all, marketing and apple and Google app stores. 
SF, LA and London are all bloody expensive holes, not the usual place where you’re supposed to find small business founded by 20 yo nerds. Early stage businesses usually go where fixed costs are cheap, not expensive. 
However, this time around, the whole system was built on cheap money from banks and private capital and MBAs network.  99% of it is a Ponzi scheme. 
My take is that something good will still see the light of tomorrow in London: nu-banks have a really agile structure, they all hire remotely, roles that cannot pay London wages have been outsourced to EE and Spain where costs are lower and we will still see Revolut, Monzo, N26 around for a long time. 

Edited by NoHPCinTheUK
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11 hours ago, Ballyk said:

What does the Telegraph mean 'fail to compensate for leaving the EU'? 

I thought that was meant to be a good thing?

They're trying to blame anything but the current Tory party for the cluster f#ck we are seeing. In order to generate the dynamic energetic private sector economy to engage with the global economy they'd have had to stop pandering to the standard Tory VIs with subsidies like kids with inheritances, pensioners, foreign tax exiles, the rich in general etc etc. Hitting the working masses with job taxes and a disfunctional abusive housing market is not the way to turn the UK into Singapore.

Latest is they're blaming it on Biden now.

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14 hours ago, byron78 said:

Indeed.

It is really eerie in parts.

Park Lane is just a ghost town.

as a counterpoint, was in a hotel near Hyde Park for drinks yesterday and the place was heaving

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6 minutes ago, andrewwk said:

as a counterpoint, was in a hotel near Hyde Park for drinks yesterday and the place was heaving

Free green space in London on a hot day. Not a huge surprise that!

Any walk up Park Lane is surely still full of empty mansions left to rot though?

Edited by byron78
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1 hour ago, NoHPCinTheUK said:

The whole start-up scene has been inflated by 10 years of really cheap money and above all, marketing and apple and Google app stores. 
SF, LA and London are all bloody expensive holes, not the usual place where you’re supposed to find small business founded by 20 yo nerds. Early stage businesses usually go where fixed costs are cheap, not expensive. 
However, this time around, the whole system was built on cheap money from banks and private capital and MBAs network.  99% of it is a Ponzi scheme. 
My take is that something good will still see the light of tomorrow in London: nu-banks have a really agile structure, they all hire remotely, roles that cannot pay London wages have been outsourced to EE and Spain where costs are lower and we will still see Revolut, Monzo, N26 around for a long time. 

I really hope that the likes of Revolut etc will start to hurt the traditional retail banks and, if nothing else, force them to modernise.  I have a Revolut account and, frankly, the service is awesome.  If I didn't have a slight distrust over their Russian ownership and lack of FSCS cover I'd use them a lot more.  Their app is miles better than my traditional high street bank app and the transparency and availability of market rates for currency is showing how badly ripped off the average consumer is.  If I transfer money from my bank to Revolut it shows up instantly (under 2 seconds normally) in Revolut.  If I do it the other way round its usually 1 hour or more.

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7 minutes ago, byron78 said:

Free green space in London on a hot day. Not a huge surprise that!

Any walk up Park Lane is surely still full of empty mansions left to rot though?

I meant the hotel

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19 minutes ago, Gurgle said:

I really hope that the likes of Revolut etc will start to hurt the traditional retail banks and, if nothing else, force them to modernise.  I have a Revolut account and, frankly, the service is awesome.  If I didn't have a slight distrust over their Russian ownership and lack of FSCS cover I'd use them a lot more.  Their app is miles better than my traditional high street bank app and the transparency and availability of market rates for currency is showing how badly ripped off the average consumer is.  If I transfer money from my bank to Revolut it shows up instantly (under 2 seconds normally) in Revolut.  If I do it the other way round its usually 1 hour or more.

I do have a Revolut account to and yes, it’s really good for all the basic stuff. Anyway, banks should also be the place you’d go to buy and sell money. Nu-banks are still far way behind traditional shops in this space. The likes of Monzo, Revolut etc are right now payment app at their core, plus some FX and trading. They’re not “banks” but I think their business model might evolve, albeit whilst increasing the spread between local economies and banking sector. They will probably be good as mortgage shops, personal loan aggregators etc but I don’t think they are going to replace traditional banks and their credit lines to businesses from small shops to large corp clients. 

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4 hours ago, dugsbody said:

What has that got to do with my post?

Quite simple if you think about it. 

You bought up Brexit and the Russians having their stuff confiscated the two are not connected but you had to try and get a Brexit dig in.

Does that make it clear for you ? 

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Just now, NoHPCinTheUK said:

I do have a Revolut account to and yes, it’s really good for all the basic stuff. Anyway, banks should also be the place you’d go to buy and sell money. Nu-banks are still far way behind traditional shops in this space. The likes of Monzo, Revolut etc are right now payment app at their core, plus some FX and trading. They’re not “banks” but I think their business model might evolve, albeit whilst increasing the spread between local economies and banking sector. They will probably be good as mortgage shops, personal loan aggregators etc but I don’t think they are going to replace traditional banks and their credit lines to businesses from small shops to large corp clients. 

I don't run a business, I just want fair, transparent and cost effective personal banking.  I know Revolut isn't a bank but they do offer savings accounts and other financial services.  Most retail clients don't need a lot of what the traditional banks do.  But they do want access to things like share trading etc at a reasonable cost, and getting access to market rates for FX is a game changer for anyone who frequently travels to other countries or has a need to exchange currency a lot.  Most companies are charging a minimum of 0.5% on a transaction, usually plus transfer fees.

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16 minutes ago, byron78 said:

Free green space in London on a hot day. Not a huge surprise that!

Any walk up Park Lane is surely still full of empty mansions left to rot though?

Park Lane isn't that kind of place - it would be more nearby areas like Belgravia.

I'm a bit skeptical of the impact - London is a much bigger and badder intense global mix than the investment of any single country.

That said its the thread title that focusses on Russian oligarchs whereas the article cites a number of issues.

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